Price of pepper to soar as popularity grows in Far East

The cost of sprinkling a dash of pepper on food is set to rise after a surge in its popularity in the Far East.

The wholesale price of pepper has reached an all-time high after rising by more than 300 per cent in the past five years.

Increasing demand from Far East countries, which have started using more pepper in cooking, is said to be behind a price rise of 40 per cent in the past year alone.

Until now, supermarkets have absorbed the wholesale cost increase, but retail experts say shoppers are set to face higher prices.

Vietnam is the largest producer and exporter of pepper. The current price for Vietnamese pepper imported to Europe is about £7.65 per kilogramme, up 40 per cent on last year.

Compared to five years ago, the price of imported pepper has soared by nearly 310 per cent, according to market research firm Mintec.

It says the cause of the record high prices is a surge in demand. Between 1991 and 2011, demand from emerging markets such as South East Asia has increased nearly fourfold.

Demand for pepper in China grew more than 200 per cent during the same decade. Pepper consumption has also risen in traditional markets, up 15 per cent in Europe and 45 per cent in North America, as people seek more flavour to their meals.

This has led to worldwide pepper consumption rising by 60 per cent over the same period to reach 430,000 tonnes in 2011.

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In new markets such as the Far East, much of the increase is due to higher consumption of meat dishes, which improve with seasoning.

Meanwhile, due to production problems in Vietnam, output is down by 13 per cent, putting more upward pressure on prices.

Pepper importers are now turning to other countries, such as India, Sri Lanka and Indonesia.

Jara Zicha, a market analyst at Mintec, told The Grocer magazine: "Even with high production from the smaller producers, the continuing demand growth and lower production from Vietnam are expected to keep pepper prices high."